Fresh Fruit Co.: Import and Export Case Study Presentation

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Introduction of the Company

  • Fresh Fruit Co.- importer and exporter of fruits and beverages.
  • Established within the free zone.
  • Due to demand of fresh and healthy products in UAE.
  • Various partners within Africa and Asia.
  • FFC has high chances of accelerated growth.

Introduction of the Company

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Setting Up in Free Zone

  • Licensing: Designed to incorporate international business (Strong and Himber 36);
  • Set up within designated zones: Airport FZ;
  • Each zone has sector preferences;
  • In line with the UAE economic-growth interests;
  • Limited liability- individual or corporate ownership;
  • Cannot conduct local bussiness.

Setting Up in Free Zone

Free Versus Non-Free Zones

  • FZ business can be 100% foreign owned;
  • No corporate taxes in FZ;
  • No currency restrictions in FZ (Hvidt 400);
  • Energy provision subsidized /guaranteed in FZ;
  • 24-hour operations for FZ companies;
  • Centralized operations in FZ;
  • All FZ entities subject to custom.

Free Versus Non-Free Zones

Challenges of Setting up Company

  • The process is lengthy and tasking;
  • FZ rules take precedence over company policies (Rao 251);
  • The one-shareholder policy is a hindrance;
  • High need for research;
  • Difficulties settling for the right zone;
  • Immigration rules and requirements.

Challenges of Setting up Company

Addressing Challenges

  • Have full understanding of incentives for each FZ;
  • Cooperate with local authorities/Emiratis;
  • Conduct prior market research;
  • Utilize local and international experts (Zarrouk 48);
  • Sort out ownership issues before registration;
  • Operate within legal frameworks.

Addressing Challenges

Setting up for Non-Emiratis

  • Seek residency confirmation for both owners and staff;
  • Tax residency certificate;
  • Familiarize with local business culture;
  • Visa-holding employees might require mandatory 6-month residency;
  • Formulate relationships with local enterprise.

Setting up for Non-Emiratis

Logistical Challenges

  • Special storage for fresh products is a must;
  • Additional requirements for trading within the UAE;
  • Limited use of expatriates;
  • Leasing space within FZ is mandatory;
  • Lengthy documentation is a requirement;
  • Only viable for long-term businesses.

Special storage might limit the business to airport environment, an option that is expensive for the FFC.

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Logistical Challenges

Setting up in other GCC Countries

  • Fresh products still a favored product in GCC;
  • Similar legal codes just like in UAE (Hertog 52);
  • Bahrain has the most reputable FZ within GCC;
  • Similar incentives across GCC with subtle differences;
  • Saudi Arabia has the least reliable FZs;
  • All FZs target specific industries;
  • Fresh fruit business is favored by both FZ and non-FZ;
  • GCC customs laws are largely similar;
  • Businesses operating under FZ require mainland intermediaries;
  • Visa and other permit requirements similar;
  • Kuwait and Saudi Arabia standout in GCC.

Setting up in other GCC CountriesSetting up in other GCC Countries

Setting up in Singapore

  • GIP program for all potential investors;
  • EntrePass –for those setting up companies in Singapore;
  • Visa requirements are limited to locations and activities (Wan, Ong, and Lee 262);
  • Businesses registered through ACRA;
  • Foreign companies require at least 2 local agents.

Global Investor Program (GIP) –makes it easier for foreigners to enter and conduct business in Singapore.

Accounting & Corporate Regulatory Authority (ACRA)- registers all types of businesses.

  • Singapore’s economic data is readily available;
  • Finding suitable premises a challenge;
  • Consultancy services are readily available;
  • Involvement of natives a must for foreign businesses in Singapore;
  • Taxes: income tax, GST Tax, etc;
  • Corporate tax is 17%.

GST- Goods and Services Tax.

Setting up in SingaporeSetting up in Singapore

Recommendations

  • FZ set up should be accompanied with local branch;
  • FZ mode cheaper in the long-run;
  • FZ makes it easier to sell within the GCC;
  • UAE still the best option within GCC, then Bahrain;
  • DAFZA the most ideal FZ for FFC;
  • Market research and consultancy before setting up.

DAFZA – Dubai Airport Free Zone Authority.

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  • FZ is ideal for citizens and non-citizens;
  • Beverage and fresh products on high demand within the UAE;
  • Non-FZ ideal for smaller and short-term businesses;
  • All logistics can be circumvented.

RecommendationsRecommendations

Works Cited

Hertog, Steffen. “The GCC and Arab Economic Integration: a New Paradigm.” Middle East Policy 14.1 (2007): 52. Print.

Hvidt, Martin. “The Dubai Model: An Outline of key Development-process Elements in Dubai.” International Journal of Middle East Studies 41.03 (2009): 397-418. Print.

Rao, Kishore. “Free Zones in the Middle East: Development Patterns and Future Potential.” Trade Policy Developments in the Middle East and North Africa (2000): 245-264. Print.

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IvyPanda. (2022) 'Fresh Fruit Co.: Import and Export Case Study'. 27 August.

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IvyPanda. 2022. "Fresh Fruit Co.: Import and Export Case Study." August 27, 2022. https://ivypanda.com/essays/fresh-fruit-co-import-and-export-case-study/.

1. IvyPanda. "Fresh Fruit Co.: Import and Export Case Study." August 27, 2022. https://ivypanda.com/essays/fresh-fruit-co-import-and-export-case-study/.


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